Justify Charity Deduction

Your Money - TIPS

December 31, 2000

The idea has great appeal: Give your old car to a charity, take a tax deduction, and raise money for a good cause -- perhaps even help train poor people in a marketable trade. But while giving your car to a bona fide charity is a legitimate deduction, experts say you should be very careful about the amount you write off. The temptation is great to be aggressive in assigning a value to the old buggy, and some charities seem to encourage that. That's asking for trouble, said Arthur Auerbach, an accountant based in Vienna, Va. The Internal Revenue Service has told people that this is a high-audit issue, he said. The IRS may be bluffing. But if you've got a car or other vehicle you'd really like to donate and you'd prefer not to play the audit lottery, experts advise taking steps to justify the value you assign to the car and any deduction you take.

TIPS TO HELP SAVINGS HABIT

Here are three ideas for helping kids develop good savings habits, according to the National Endowment for Financial Education: 1. Pay yourself first. From every allowance, deposit a set amount into a savings account or piggy bank before using any of the money for anything else; 2. Catch your coins. Drop all your loose change into a piggy bank, jar or other container. Once a month, put the money in a savings account; 3. Bank your surprises. Whenever you get a cash gift or other unexpected money, put part of it in your savings account.

EXEC HIRING MAY INCREASE

Even though the U.S. economy is slowing down, many human-resources executives predict that the coming year will be a good one for executive and professional hiring. About 59 percent of human resources executives plan to increase the number of such staffers during the first half of 2001. Another 35 percent plan to maintain current levels, but only 6 percent plan to hire fewer executives and professionals, according to a survey of 3,500 hiring executives by Management Recruiters International Inc.